BuyER Beware: Freestanding ER giant in financial trouble

As the stock price of the country's largest operator of freestanding emergency rooms continues to tumble, the company's Colorado partner said Tuesday it remains committed to the "long-term success" of the two hospitals and 17 freestanding emergency rooms the two jointly own.

Author:
Chris Vanderveen

Published:
12:30 PM MDT May 8, 2017

As the stock price of the country’s largest operator of freestanding emergency rooms continues to tumble, the company’s Colorado partner said Tuesday it remains committed to the “long-term success” of the two hospitals and 17 freestanding emergency rooms the two jointly own.

UCHealth’s statement comes as the stock price of Texas-based Adeptus Health dipped below $1.50 at the end of trading Tuesday. Back in May, the stock price topped $73.

Investors continue to react to a series of filings with the Securities and Exchange Commission indicating continued and substantial financial woes for a company that owns more than 100 freestanding ERs nationwide.

After reviewing the most recent SEC filings, University of Denver Daniels College of Business Professor Mac Clouse told 9Wants to Know there is “an indication there are serious problems” within Adeptus Health.

Earlier this month, Adeptus Health reported “there is substantial doubt about the Company’s ability to continue as a going concern absent its securing committed long-term financing.”

“That means bankruptcy may be coming up,” explained Clouse.

He made a point to say, however, that bankruptcy is not a foregone conclusion. “Ultimately, you have to fix the operating problems – the operating model – that’s leading to the fact that you don’t have the cash to make loan payments,” said Clouse.

In addition, just yesterday Adeptus reported it had hired a California-based financial advisor to serve as the company’s chief restructuring officer. “Firms don’t hire chief restructuring officers unless they’re thinking about restructuring, which Chapter 11 bankruptcy is all about,” said Clouse.

UCHealth said Tuesday it “is committed to the long-term success of Broomfield Hospital, Grandview Hospital and the outpatient locations operated through our partnership with Adeptus Health.”

The statement did not elaborate.

9Wants to Know has reported on the billing practices of the state’s burgeoning freestanding emergency room industry extensively. If you have a story or a bill you’d like to tell us about, email us at showusyourbills@9news.com